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A GOP Primary for Governor?

U.S. Sen. Kay Bailey Hutchison is seriously considering entering the race for governor of Texas, according to friends and supporters. That's contrary, mildly, to her 14-month-old pronouncement that she probably would not run against an incumbent governor. But that was during the presidential race. Hutchison herself was up for reelection to the U.S. Senate, and things were more fluid then. There had been no presidential primaries and it wasn't clear that anybody in Texas politics was going anywhere.

U.S. Sen. Kay Bailey Hutchison is seriously considering entering the race for governor of Texas, according to friends and supporters. That's contrary, mildly, to her 14-month-old pronouncement that she probably would not run against an incumbent governor. But that was during the presidential race. Hutchison herself was up for reelection to the U.S. Senate, and things were more fluid then. There had been no presidential primaries and it wasn't clear that anybody in Texas politics was going anywhere.

Now that George W. Bush is president and Hutchison has been sworn in to a second full six-year term, talk of a run at the Governor's Mansion has picked up. She would get a free shot, returning to the Senate for four more years if she lost a gubernatorial bid. And she would get to run for the next best thing to an open seat, taking on an incumbent governor who wasn't elected to the office and who doesn't have the saturation name recognition that comes with winning a governor's race.

Gov. Rick Perry is, however, a Republican, and there are those in the party who think he ought to be allowed to focus on challenges from Democrats and not from within his own political clan. Hutchison's promoters contend she would be a stronger candidate if the Democrats put up a good enough candidate to put the GOP's hold on the seat in jeopardy. That's one rationale; another is that Hutchison would be the best alternative to Perry if he has a rocky legislative session or if he gets several months down the line without solidifying his hold on voters and the job.

And why would a U.S. senator be interesting in dropping out and moving to Austin? There's an old joke that explains part of it: The governor doesn't visit the senator's mansion. More to the point: A Governor's Mansion is a better platform for an ambitious politico. With the exception of the first President George Bush, former governors have held the White House since 1976.

Meanwhile, a Democrat Takes a Preparatory Step

It'll be six months before you get a peek at the financial reports (and may be that long before the candidate himself speaks publicly), but there's a new exploratory committee out there: Laredo banker/oilman/investor A.R. "Tony" Sanchez Jr. has filed papers with the Texas Ethics Commission. That will allow him to raise and spend money on his maybe-maybe-not race for governor. The treasurer is Randall "Buck" Wood, the Austin lawyer who's probably best known for representing school districts in school finance cases.

Throw in still-in-draft legislation from Sen. Ken Armbrister, D-Victoria, that would block candidates from moving federal campaign funds to state campaign accounts. That's allowed now, partly because federal campaign laws are stricter than the Almost Anything Goes campaign finance laws in Texas. But you can't move money in the other direction, and for the same reason. The state's campaign finance laws don't pass federal muster and the money raised here is tainted in that system. Money for federal races can only be raised under that system's rules.

Armbrister says nobody put him up to it, but his bill would create a speed bump for Hutchison. On the face of it, that would help Perry. But some folks who would support Sanchez say the Laredo Democrat would rather face Perry than Hutchison and that Armbrister's bill thus helps Sanchez. A historical point is in order here. Hutchison, then a state treasurer, returned money to contributors from her state account when she ran for U.S. Senate, asking them to consider writing a check to help her in the federal race. The money piled in. If she went the other way, from federal to state, she could add this prod to donors: There are no limits on the amounts given for Texas state races.

The Session's Main Topic Isn't Legislation

It's just a hunch at this point, but the earlier than usual positioning for state offices could turn out to be the theme of this legislative session. Earlier confabs became known for big issues. People talk about the Workers' Comp Session, or the School Finance Session, or the Tax Relief Session, or the Tort Reform Session. Redistricting will crowd out some other things, but even a redistricting session can be known for other issues. In 1991, lawmakers were working on redistricting but were also preoccupied with the budget and with a huge tax bill, for instance.

This time, redistricting combines with a pool of ambitious state officeholders on the GOP side and a prominent empty spot in the political realm left when President Bush got promoted. With almost a year still to go before the filing deadlines for the 2002 primaries, candidates are already aggressively positioning themselves. It's almost like the parties have swapped places. It used to be that Democrats would be biting each other on the ankles, while Republicans were sitting around in a war room devising ways to avoid family fights. Now, you've seen the Republicans squaring off for what might turn into some contentious primaries. Democrats, out of office and with a smaller number of proven contenders, are trying to pull together a statewide ticket that's more unified than in the past.

Currently on their list: Sanchez for governor, though he hasn't made a final decision on whether to run; former Comptroller John Sharp for lieutenant governor, a race he lost–narrowly–two years ago; and Austin Mayor Kirk Watson for Attorney General. Sanchez will likely keep quiet about his intentions until mid-summer or later. Watson can't say until he has decided: Under Texas law, declaring himself a candidate for the state race automatically resigns him from his city office. Some other names are in the hunt, but they're still working on the rest of the ticket.

Another part of the Democratic strategy is to engineer a massive minority-focussed voter registration and get-out-the-vote campaign, on the general theory that more of the Texans who don't vote are Democrats than are Republicans, and that more of them are minorities than Anglos.

After the Politics, a Hodgepodge of Issues

That leaves lawmakers with the rest of the session, looking at a number of issues with about equal weight. On the first tier sit redistricting and the state budget. Those are the only two things that really and truly have to be completed in the next 16 weeks.

The next tier has all the "wanna's" on it. If you lump together everyone's lists, from Gov. Perry to Speaker Pete Laney, from legislators to lobsters to interest groups, that includes higher education, highway bonds, teacher health insurance, prison guard pay raises, Border issues, rural initiatives, campaign finance reform, election reform, privacy issues, death penalty reform and hate crimes.

Top it with Sudden Populism–wildcard legislation that unexpectedly or accidentally grabs the public's interest and dominates news. Past examples were concealed handguns and right turns on red lights. Sen. Jeff Wentworth, R-San Antonio, got a taste of Sudden Populism by filing a bill regulating bicycle traffic on farm-to-market roads. The website-posting, email-and letter-writing, news-grabbing bicyclists hit the fan and flooded his office with opinions about his bill.

Other wildcards that could emerge include:

• Electric un-deregulation. If you ask the guys who worked on restructuring of the electric industry two years ago, they'll give you 300 reasons why Texas isn't California, and why the Texas deregulation that unfurls in a year or so won't produce blackouts and stories of people who were forced to scarf down untoasted Pop Tarts on the way to work because of rolling blackouts. There's already legislation that would allow regulators to delay the deadlines if things go wrong.

• Election reform. If you're aware of the word "chad," you need no more explanation here.

• Death penalty reform and hate crimes. They're on this list because, unlike a lot of issues, they can attract smaller-market television news crews that ordinarily aren't interested in legislative stuff. We're not gonna knock anybody here, but when you see a local TV crew from outside of the major cities, they're either doing a profile on a local politico, or Sudden Populism has erupted.

CHIP's Bigger Sibling

Think back two years ago, when lawmakers debating the Children's Health Insurance Program, or CHIP, were sweating about the idea that a big push for that program would increase the number of kids getting Medicaid benefits. Medicaid is primarily for poorer children, and federal law says that if a child applies for CHIP and is eligible for Medicaid, the state is required to direct that child to Medicaid. The term for that, which human services advocates don't particularly like, is Spillover.

The legislative argument two years ago was that an aggressive CHIP program would cause a budget blowout in Medicaid because of the spillover effect. But that didn't happen, at least not in the magnitude some had feared. And the reason, in part, was that it's so hard to sign up for and then remain enrolled in Medicaid.

That's the basis for this session's round of children's health insurance legislation. Their push is to simplify Medicaid, making the signup and retention process similar to what's already in place for CHIP. Uninsured Texas children are their target, primarily the 658,000 who are eligible for Medicaid but not signed up. (Another 400,000 are eligible but un-enrolled for CHIP; the state is already pushing an extensive marketing campaign to sign them up.)

Their biggest hurdle is the price tag for doing the things they want to do, like ending a requirement for face-to-face interviews before someone can sign up, and eliminating a complex test of assets that's one of the entry requirements. Those two things alone would cost about $36 million a year by legislative estimates. The third item on the list makes up the balance of their estimated $400 million price: It would let kids sign up for 12 months at a time without having to continuously prove their eligibility. Those changes would only apply to Medicaid for children, but the price tag is still a monster.

A different set of numbers, done by the Texas Association of Community Health Centers, is based on a survey of what happened when the various barriers were knocked down in pilot programs. That study concluded that wiping out face-to-face interviews would cost the state about $28 million. Put another way, the state is saving that much in benefit costs because some people can't make it in for the face-to-face meetings. (The study assumes, based on the pilot results, that they were qualified applicants.) Wiping out the assets test would cost the state about $55 million in the next biennium.

But TACHC put a much lower number than legislators on the price of continuous eligibility. Part of the reason was that people who are sickest and who most need the benefits are more likely to go to the trouble to stay in the program. The people who weren't in the program weren't as likely to use benefits and were, on average, lower cost clients. It's analogous to what might happen to car insurance, for instance, if the good drivers all decided the hassle was too great and just dropped out. That, they said, would cost about $122 million over the next two years, for a total price tag to the state of about $205 million. Add in federal costs, and the price goes up to $536 million.

Full House

You can take the "former" off of state Rep. Richard Raymond's title and fill in that last blank in the House roster. Raymond, who used to be a D-Benavides, is now a D-Laredo, after winning a four-way special election without a runoff. He got 7,090 of the 12,930 votes cast, or 54.8 percent. His nearest competitor, Carlos "CY" Benavides, got 18.6 percent. Javier Martinez got 13.4 percent, and Maria Morales received 12.9 percent of the votes. Here's the swap the voters got. Rep. Henry Cuellar, who held the seat for seven terms, had risen into management. He was vice chairman of the House's Higher Education Committee and had a seat on the powerful Appropriations and Calendars panels. Raymond, who was elected after his 149 colleagues had already received their committee assignments, got posts on Human Services and on State Federal and International Relations. In his previous incarnation in the House, the three-term member was on Appropriations and Economic Development.

Off the Tracks at the Railroad Commission

The new ethics policy for Texas Railroad Commissioners has grill marks on it.

The Hatfields and McCoys feud between Commissioners Charles Matthews and Tony Garza reached a peak Thursday when Garza introduced an ethics proposal aimed at Matthews and his son, who works for a company regulated by the agency.

The new rule hits directly at Matthews and his son, who works for Lone Star Gas in a northern suburb of Dallas. In a case last year, Garza suggested Matthews should recuse himself from a case involving the gas company where his son was employed. Matthews refused, saying he didn't see a conflict and noting that he ruled against the company in other cases.

Under the new rule, Matthews would have to recuse himself in future cases. If he didn't, he would have to file a written explanation of why he didn't think a conflict existed. It also says that any commissioner who spots one of his comrades violating the rule would be obligated to say something about it at the commission's next public meeting.

The three commissioners voted 2-1 to put the proposed rule in place immediately; it'll be a formal rule after the regular rule-making gears have turned for a while. Garza and Chairman Michael Williams voted for it. Matthews voted no, contending, as he has for some time, that the agency should simply adopt the ethics code used by the state's Public Utility Commission.

After Garza introduced the rule, Matthews started his remarks by hoping "that we'll spend our time more productively in our next meeting." That was just the warm-up. He called the rule "government by ambush" and "a repeated attempt by one of my colleagues to discredit me and to cause me problems." He accused Garza of trying to recruit a candidate to run against him and said he "threatened members of the lobby who said they were going to support me." He made an analogy to the presidential race in Florida and to the U.S. Supreme Court, saying Justice Scalia's son works for one of the law firms that worked on the Bush campaign and that Scalia, like Matthews, saw no conflict.

Williams stayed out of the fight for the most part. He told Matthews that the rule wasn't a personal attack and then voted with Garza to approve it. Garza then wanted to comment, and they began interrupting each other. At one point, Garza called Matthews "Charles." Matthews told him "Commissioner would be fine." Garza responded: "Chuck." Williams tried to intervene and finally got a handle on it. Matthews blasted Garza for throwing out the rule on short notice. Garza snapped back that Matthews was being "almost breathtakingly vain."

As soon as he could get a gavel in edgewise, Williams adjourned the meeting. Later, in a press release, he applauded Garza for pushing an ethics policy when "there was limited outside pressure to do so."

To Raid or Not to Raid

They papered over the differences pretty well, but Gov. Perry's decision to make Grace Shore the new chair of the State Board of Education pulled some noses out of joint. They're not complaining too loudly, but there is some sentiment among her fellows and among some GOP board watchers that Chase Untermeyer would be better at keeping that contentious panel calm. Untermeyer was former Gov. George W. Bush's pick for the job; Shore was named to the post when his term as chairman ended (He'll remain on the board for the rest of his elected term, however).

One difference between the two can be found in their reactions to budgeting some of the capital gains in the public school trust fund instead of leaving principal alone and paying for education with the interest. Untermeyer has said he's skeptical without actually saying he's against it.

Some of the state's budgeteers, led by Appropriations Chairman Rob Junell, like the idea of a constitutional amendment that would allow some–but not all–of those gains to be used in the budget. Junell says the state did it last session with a similar college endowment and it's worked fine. He and other lawmakers want to use the money for things like teacher health insurance. The finance folks on the education board will meet next week to study the proposals.

Property Taxes, Flotsam & Jetsam

We wrote last week about a potential lawsuit challenging the state's property tax exemptions for pollution control equipment. First, upgrade that to a probable lawsuit. Second, some of the people behind that effort say the numbers from the state comptroller's office showing the values of the exemptions are on the low side. That's not the comptroller's fault; they're just reporting the numbers they get from counties, and some of the lawyers involved in this say the county reports are flaky. To size the pollution exemptions, they prefer to use numbers from the Texas Natural Resource Conservation Commission. The estimated value of exempted property there is around $7.6 billion. The comptroller's numbers were less than half that amount.

• Take another property tax lawsuit off the legislative front burner. Wealthy school districts say they'll soon sue the state because of the Robin Hood provisions that force them to share their wealth with poorer districts in the state. Legislative leaders put a pin in that balloon, at least for now, by saying they'll order a full study of school finance formulas after this legislative session. That does two things: They'll get a blueprint for the next round of school finance law without having to mess with it during the current session; and they'll potentially buy time, if the courts are in a hurry, by showing they're working on the problem.

• Tax cuts don't have the legislative pizzazz they had two years ago, but the folks in the oil patch can still remember what a mess they were in at that time. In spite of the fact that prices are high at the moment, which makes their argument a little difficult, they're after a break in oil and gas severance taxes. Some industry groups want the taxes whacked altogether.

Sen. Teel Bivins, R-Amarillo, has a bill that would cut the tax rates as prices fall, raising them as prices rise. And he's got a safe place to stand. The tax rate on oil wouldn't fall unless prices go below $20 per barrel, or on gas unless prices fell below $3 a unit. The comptroller says the prices shouldn't go below those amounts for another ten years, according to Bivins, so the net cost of his bill is zero. That could make it easier to get past the budgeteers.

Bivins got asked along the way whether it was a conflict for him to offer that bill since he has oil and gas interests. Nope, he said, and he's got an opinion from the Texas Legislative Council that says so. Their reasoning is that legislation that affects an entire industry doesn't represent a conflict. Only if Bivins was alone or among a very few beneficiaries would there be a problem, the reasoning goes.

• At the risk of telling you something you already know, we'll pass along a patch of redistricting law we didn't know about. County commissioners have to redraw their districts just like legislators do. But, unlike state senators who also serve four-year terms, only half of the county folks have to run in 2002 in the first elections after the new lines are drawn. Commissioners who are up for election anyway will have to run in new districts. Commissioners who were elected in 2000 don't have to run until 2004. That's apparently a 1983 addition to the Texas constitution, and it means that a county commissioner could spend two years representing a district that didn't elect him or her, and that some number of voters in a county could be represented by someone they've never seen on a ballot.

• We know you were dying to know this, to fill in those gaps in conversation at the dinner table. It costs the State of Texas $40.65 per day to house an adult inmate in prison in 2000, up from $38.71 per day in 1999. The comparable number for a juvenile inmate was $129.36 per day. It took $32.08 to keep an adult inmate in a state-run state jail for a day. Privately run state jails came in at $28.64 per day.

• Whiskey's for drinkin' and water's for fightin': The Texas Lyceum and the Texas Water Foundation have pulled together an impressive list of state lawmakers and policy wonks for a one-day conference in Austin. Their main topics include interbasin transfers, water marketing and groundwater management. That may sound like a root canal if you haven't been watching it, but it's full of the kind of gnarly fights that take years to resolve.

Political People and Their Moves

Former President Bill Clinton's list of last-minute pardons had nearly two dozen Texans on it, some of whom, like former HUD Secretary Henry Cisneros, got a lot of press, and some of whom, like El Paso banker Stanley Jobe, did not. Most are relatively unknown, at least in political circles, and include an Elgin couple who submitted false forms to immigration officials, a couple of people convicted on relatively minor drug charges, a counterfeiter, and several who were convicted on various financial charges. Jobe, you might recall, contributed to a couple of Democrats in 1998 and stirred up some dust in the process. John Sharp gave the money back after a slap from Rick Perry about taking money from felons (Jobe was convicted on bank fraud charges). Jim Mattox, running for attorney general, offered to take the money Sharp gave up. Austin banker Ruben Johnson, who had a Who's Who of old Austin types writing letters on his behalf, got a pardon...

King for a Week: UT Regent Tom Loeffler, a lobbyist and former congressman, will be chairman of that UT group for about seven days. He'll replace Don Evans, who is now the U.S. Secretary of Commerce, until his own term is up. Loeffler will be outtathere on Friday, February 1... Deana Hendrix is leaving the Hughes and Luce law firm, and the lobbying game, too. She's taking a job in the recreational sports division at UT Austin. They run intramural sports and such...

Jeff Reed, who worked for former Sen. Drew Nixon, R-Carthage, signs on as director of the law enforcement training academy and as special assistant to the director of the Deep East Texas Council of Governments... Wendell Bell has moved over to the Texas Public Power Association to do regulatory and legislative work. He was with the Texas Electric Cooperatives for a decade...

Unrelated job moves at the comptroller's office: Bill Eggers, lured to Austin from a California think-tank by Comptroller Carole Keeton Rylander, stuck around for two years, through the publication of Rylander's' "e-Texas" report, and left. He told associates he was going to spend some time decompressing before looking for work. Eddie Solis moves over to the policy staff of Lt. Gov. Bill Ratliff, where he'll oversee border issues. Craig Daugherty, a revenue estimator who specialized in watching and predicting franchise taxes, moved to the Lower Colorado River Authority.

Quotes of the Week

Don Casey, president of the Blanco County Farm Bureau, listing things that can go wrong when a driver hits a bicyclist on a farm-to-market road: "There's also the emotional strain. I don't want to have it on my conscience that I ran over one of them. It's a lose-lose deal."

Economist Ken Rose of the National Regulatory Research Institute at Ohio State University, on California's electricity problems: "Market forces were supposed to discipline the market better than what regulators could do. But if market forces are weak, or somebody has market power, there's a tremendous ability of suppliers to control the price, or at least influence it, and not a lot of recourse for the state, because power plants are now out of their jurisdiction."

U.S. pardons attorney Roger Adams, after Bill Clinton used his last hours as president to pardon or commute the sentences of 176 people: "I've never seen anything like this. We were up literally all night as the White House continued to add names of people they wanted to pardon. Many people on the list didn't even apply for pardons."

Singer Larry Gatlin, introducing Florida's Secretary of State at an inaugural ball: "In France it was Joan of Arc. In the Crimea it was Florence Nightingale. In the Deep South there was Rosa Parks. In India there was Mother Teresa. And in Florida there was Katherine Harris."

Amarillo attorney Jeff Blackburn, quoted in the Houston Press on how attorneys and activists banded together when law enforcement folks in Tulia arrested ten percent of that town's black population on drug charges: "We are going to build a model of how you resist something like this. You get the community organized and mobilized. You keep the story in the news. You keep it moving, and you sue the shit out of everybody."

Texas Weekly: Volume 17, Issue 29, 29 January 2001. Ross Ramsey, Editor. George Phenix, Publisher. Copyright 2001 by Printing Production Systems, Inc. All Rights Reserved. Reproduction in whole or in part without written permission from the publisher is prohibited. One-year online subscription: $250. For information about your subscription, call (800) 611-4980 or email For news, email, or call (512) 288-6598.

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